Egypt’s Supreme Administrative Court declared on Monday that the Red Sea islands of Tiran and Sanafir are Egyptian, nullifying a controversial agreement to transfer them to Saudi Arabia and leaving Egypt’s administration in a tense position with the Saudi Kingdom.

A diplomatic source from the Gulf country, speaking on condition of anonymity, said Saudi Arabia gave Egypt a “semi-final warning” in late December, stipulating that the transfer of the islands to the Gulf monarchy should take place within two weeks.

In April 2016, Egyptian Prime Minister Sherif Ismail and King Salman Bin Abdel Aziz signed a maritime border agreement that would give Saudi Arabia sovereignty over the two islands. In response, a group of Egyptian lawyers filed a lawsuit challenging the agreement with the Court of Administrative Justice, which ruled in June that the prime minister violated the Constitution by signing the agreement.

The government contested the decision on several fronts, appealing it before the Supreme Administrative Court, which ruled that the Egyptian government did not provide adequate evidence supporting Saudi Arabia’s claim to the land, and that the executive branch of Egypt’s government does not have the administrative authority to cede territory to Saudi Arabia.

The state also filed a separate appeal in August before the Supreme Constitutional Court, claiming that the State Council has no jurisdiction over international agreements. This appeal remains pending, with a verdict expected on February 12.

How will negotiations impact bilateral relations?

Saudi Arabia pressured Egypt on several fronts, according to a government source involved in the Tiran and Sanafir deliberations, who spoke to Mada Masr on condition of anonymity. This included halting its petroleum aid, pushing Egypt to rely on its meagre fuel sources to prevent shortages, an issue associated with Mohamed Morsi’s presidency. The Saudi government also attempted to prevent Egypt from receiving aid from other Gulf states, including efforts to delay the first installment of a US$12 billion loan from the International Monetary Fund and suspending its subsidizing of Egypt’s military purchases.

A high-level Saudi delegation paid a visit to Cairo at the end of December and conveyed the kingdom’s warning that delays in transferring the two islands would not pass without consequences. Four days after the visit, Egypt’s Cabinet referred the agreement to Parliament, where a rare oppositional coalition, including members usually supporting government decisions, refused to vote ahead of the Supreme Administrative Court’s ruling on Monday.

According to Abdallah al-Sinnawy, a writer who used to be close to Sisi’s circles, a large number of parliamentarians expressed their concern about the deal in a closed session, out of fear that public dissent could land them in military trials.

The December visit by the Saudi delegation was followed by the suspension of Ibrahim Eissa’s television show on the satellite Al-Qahera wal Nas channel. A source close to the show said the decision to suspend the program came on the same day that Eissa — who is a staunch critic of Saudi Arabia and the island agreement — was planning to host lawyer Khaled Ali, who led the legal battle against the government’s deal.

An Egyptian diplomat, speaking on condition of anonymity, told Mada Masr Egypt has been seeking Arab mediation to influence Riyadh to reconsider its stance. The hope was for a signed agreement concerning bilateral relations, but this seems unlikely after the Supreme Administrative Court’s ruling on Monday. “We are now waiting for a few days and hoping for a breakthrough, despite the complications,” the diplomat said, as there are a number of issues exacerbating the situation, including Egypt’s position on Syria and Yemen.

The dynamics between the two nations have been further impacted by the second heir to the Saudi throne’s desire to bolster his political position by passing an agreement showing Egypt’s reported willingness to withdraw from leadership in the region.

What was in the case file?

The case file passed to Parliament has been locked away in the office of Parliamentary Speaker Ali Abdel Aal, with only select documents made available to MPs, in an effort to stem further anger, according to the government source.

Correspondence examined by Mada Masr traces the beginning of the Tiran and Sanafir agreement to December 2015, after two months of intense negotiations between Egypt and Saudi Arabia. Former minister and legal expert Moufid Shehab took part in negotiations, causing unease among other Egyptian negotiators, who considered his participation a conflict of interest, given his work as a legal consultant for Saudi Arabia, which Shehab denies.

The file also contains documentation attributing responsibility for the agreement to a sealed letter, signed by former Foreign Minister Esmat Abdel Meguid, to his Saudi counterpart Saud al-Faisal. Both men died in the last three years.

A letter from Prince Mohamed bin Salman, states that the Saudi Kingdom agreed to abide by international obligations regarding the two islands — an implicit reference to the peace agreement signed between Egypt and Israel in March 1979.

In addition, a letter from Egypt’s Foreign Minister Sameh Shoukry addressed to Israeli Prime Minister Benjamin Netanyahu refers to Saudi Arabia’s declaration of commitment to international obligations. A written reply from Netanyahu recognizes the Egyptian-Saudi agreement.

The file also contains a letter from Cairo to Tel Aviv and Riyadh regarding security arrangements with multinational forces and observers deployed at the border area between Egypt and Israel. This document is said to be the most disturbing to Egypt’s Ministry of Defense, as it obliges Egypt to notify Saudi Arabia in the case of any security violations concerning the two islands and to take military action if the Saudi military does not respond. This effectively means Egypt would continue to be responsible for the security of the islands, as Saudi Arabia is not party to the arrangements included in the Camp David Accords.

The signing of the island agreement by Prime Minister Sherif Ismail came after the ministers of foreign affairs and defense refused to directly engage in the matter, according to a government source. Egypt’s foreign minister also reportedly warned against the dangers of the deal, negotiations for which were halted in the 1990s by former President Hosni Mubarak, despite a Saudi request for the land transfer.

The issue was not brought up again until Prince Mohamed bin Salman visited Sisi a few months before the arrival of the Saudi king. The Cairo Declaration, which came at the end of bin Salman’s visit to Egypt in July 2015, included an agreement to “set the maritime borders between the two countries,” a year before the actual agreement was signed in April 2016.